All credit unions will have to meet basic solvency tests and maintain a minimum level of initial capital under a new regulatory regime, according to proposals from the government's financial services regulator.
Britain's 700 credit unions - mutually owned financial co-operatives allowing people on low incomes to save and take out loans - are currently registered by the Registry of Friendly Societies . But from July next year they will come under the regulation of the Financial Services Authority (FSA). The move is aimed at giving members. The same protection as savers with banks. The FSA's publication of the draft Credit Union Sourcebook sets out plans to improve confidence in the financial soundness of credit unions.
David Strachan, director of the FSA's deposit takers division, said: "This regime will increase consumer confidence in credit unions, enabling them to grow and meet their wider social and financial objectives."
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Government Legislation
17 July 2008
Private Member Bills
17 July 2008
Details of government consultations
11 July 2008
